Monday, February 28, 2011

"Being right half the time beats being half-right all the time." Malcolm Forbes

Yesterday, my boss pulled me aside to explain an issue that had been discovered. Apparently, one of my client's info sheets had become attached become to another client's packet. Here was the conversation:

"I don't thnk it's my fault that someone else took my client's papers and put them with their client's paper," I defended, know that I was right.

"I'm not assigning fault," my boss replied.

"Aren't we supposed to look through every sheet, before giving a client their paperwork?" I asked remembering the training I had been given.

"Well, I don't look through every sheet," my boss replied. (May have been hint#1.)

"Well, what do you want me to do to solve the problem?" I asked thinking there was a solution.

"I don't know. I was just letting you know," my boss replied.

Later I asked a colleague about who should be responsible for making sure the paperwork given to one's client is correct. He danced around the question saying he didn't want to get in the middle. He implied that I should have looked for the missing piece of paper. (May have been hint #2). For reference I just assumed I hadn't hit the print key when the sheet wasn't on our shared printer. From that discussion, he has lowered my respect for him to zero.

Anyway, my esteem for some of my colleagues and the company is quickly declining this year. My earlier estimate of only working one or two more years in this part time job may have been optimistic. There's a chance this may be my last year. My only regret is losing the relationship I have with some of my long time clients. Those are the people that mean the most to me in this job.

For more on Strategies and Plans, check back every Friday for a new segment.

This is not financial or career advice. Please consult a professional advisor.

Saturday, February 26, 2011

"Choose the harder right rather than the easier wrong." ~ Bob MacDonald

Both my dad and father-in-law were tough guys. They weren't tough guys in the traditional sense of the term. They weren't muscular, intimidating or avoided by others. To me, they were mentally tough, in how they lived and even as they faced death. Otherwise, they were regular guys. Here's what I thought made them tough:

Did what was needed. Both men did what was needed throughout their lives. I don't think they ever backed down from any hard task, personal or professional. They both had strong work ethics and strove for excellence in whatever they did. They also worked full time and earned PhDs part time while supporting young families. Although both were born into hard economic times, they were able to achieve financial success as adults. In addition, they accepted any responsibility that was theirs, never delegating it to others.

Can do attitude. Both men had a very positive attitude about their capabilities and their futures. My dad was laid off from three different jobs. Each time he quickly found another job within the industry. His started his final job at the age of 65 and worked for seven years before retiring. My father-in-law retired from the military, became CEO of a privately held company for ten years, and then taught college level course for another decade.

Rarely complained. Neither man complained much. They generally "played the hand they were dealt" the best they could. They never played the "if only" game. I should have known both were ill when they mentioned they weren't feeling well, which I had rarely heard from either one before. It wasn't long afterwards that minor complaint that both became very ill.

After my dad died, my uncle informed me that my dad had a severe stuttering problem as a young adult. I never knew my dad overcame a severe stuttering problem. He never mentioned the issue and he rarely stuttered. He, like my father-in-law, was a tough guy. To my dad, severe stuttering was only one of life's issues to be faced and conquered, as he did with many other challenges in his life.

For more on Reflections and Musings, check back every Saturday for a new segment.

This is not financial, or personal development advice. Please consult a professional advisor.

Friday, February 25, 2011

"Let us endeavor so to live that when we come to die even the undertaker will be sorry." - The Tragedy of Pudd'nhead Wilson and the Comedy of the Extraordinary Twins by Mark Twain

In You're going to die the way you lived at CNN.com, William Lamb describes how people with fatal diseases chose to live well in the time before their death by taking special trips, connecting more with loved ones and tying up loose ends. I found their stories very inspirational.

Most people in the article had between four months and four years before their death. If living a good life is a good idea, why wait until death is imminent? Since my life expectancy is about 40 more years, starting now would give me a lot more trips, connections and resolved loose ends. It makes excellent sense.

I'm going to start living a good life right away.

For more on Reaping the Rewards, check back every Friday for a new segment.

This is not financial or lifestyle advice. Please consult a professional advisor.

Thursday, February 24, 2011

For me, one of the toughest things as I get older is having to say goodbye family and close friends when they pass away. When I was younger, the death of a family member or close friend was a rare event. I only had one grandparent when I was born, and she lived overseas. A close friend from high school died in a car accident when I was college. Other than those two people, no one close to me has passed away.

Then in 2005, my dad became ill and subsequently passed away in 2006. During his illness, I was able to tell him that he was a great dad and how he had done a excellent job raising his children. I also thanked many times him for everything he had done. We thought he would fully recover, and then he suddenly passed away. I miss him very much.

Now my father-in-law is very ill. His time is short and he has just entered hospice. I have been able to talk to him for a few minutes in private. I let him know that I've enjoyed very much all the economic discussions and debates that we have had. I also told him I would help with his financial investments to the best of my ability. He eyes lit up as we talked financial matters, and I know he understood that I would miss him.

I'm not looking forward to the future inevitable goodbyes as I get older. Instead, I would rather remember the good times that I enjoyed with someone. Hopefully, when it's my time to go, my family and close friends will also smile for our good times together :-)

For more on Crossing Generations, check back every Thursday for a new segment.

This is not financial or grieving advice. Please consult a professional advisor.

Wednesday, February 23, 2011

It's been over four years since I started My Wealth Builder. As I think about topics to write , I often remember, "I've written about that before," and decide to find a new topic. However, since many principles of personal finance are timeless, I want to include them in a recent post on My Wealth Builder. Therefore, I have started a series called "Timeless Articles from the Archives" and am highlighting posts from the same week in 2007-2010.

Tuesday, February 22, 2011

Welcome to twenty-ninth edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic.

For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized them into seven categories: Earning, Investing, Insuring and Protecting, Living Frugally, Retiring, Saving and Taxes.

And now onto the Carnival:

Earning

"Money can't buy you happiness but it does bring you a more pleasant form of misery." Spike Milligan

Job-Interview-Site.com presents What Career is Right For Me? Finding the Right Career Path posted at Job Interview Guide, saying, "A few years ago, there were very less options as to what would be the best career for a person. Also, the decision would be made more on a financial basis than on an interest’s basis. The reason behind this was that most careers were not financially viable."

Michael presents How to Be a Good Boss posted at Consumerism Commentary, saying, "The better boss you are, the happier your employees are and ultimately, the more successful your business becomes. We've got a few tips to get you started."

Insuring and Protecting

"Fun is like life insurance; the older you get, the more it costs." ~ Kin Hubbard

Odysseas presents How to Save Money on Life Insurance posted at Wallet Blog, saying, "I think your readers will enjoy my submission because I explain how my husband and I were able to save money on our life insurance by doing a little bit of research."

Investing

"In this business if you're good, you're right six times out of ten. You're never going to be right nine times out of ten." ~ Peter Lynch

Hussein Sumar presents How to Analyze Mutual Fund Investment Risks posted at Best Mutual Funds, saying, "Before you head out to purchase mutual funds for your investment portfolio, you must analyze what your investment objectives are, the levels of risk you can take, your age, the # of years to your retirement, etc. Apart from these factors, you must also research the risks that an individual mutual fund contains if you put your money in to it."

Dividends4Life presents 20 CEO?s Showing Confidence With Increased Dividends posted at Dividends Value, saying, "A person’s character is determined by how they behave when no one else is looking and during difficult times. In much the same way, we can learn a lot about a company’s management when they face adversity. One metric I look at closely during a downturn is cash generation relative to earnings."

Living Frugally

"I'm living so far beyond my income that we may almost be said to be living apart." ~ e e cummings

Wenchypoo presents Coupon Queen Gets Hit With Expired Food Products--If You Shop at Dominick's, Chances are You're EXPIRED posted at Wisdom From Wenchypoo's Mental Wastebasket, saying, "Are you one of those "hyper-couponers"? You might want to pay closer attention to the expiration dates on the food you buy. All across America, grocery stores are selling goods that are as far outdated as 2-3 years ago, and if you're stockpiling them using discount maneuvers such as coupon-and-sale stacking, you might want to think twice because you're wasting HUGE amounts of money! Stockpiles of food you can't eat is akin to buying someone else's useless junk for pennies on the dollar. No matter how little you paid for it, you still can't eat it--where's the savings?"

Retiring

"When I was young I used to think that money was the most important thing in life. Now that I am old, I know it is." ~ Oscar Wilde

Saving

"There is a certain Buddhistic calm that comes from having....money in the bank." ~ Tom Robbins

Tom @ Canadian Finance Blog presents Automating Your Finances posted at The Canadian Finance Blog, saying, "Automating your finances makes sure that your money does what it is supposed to without any direction from you, reliving stress and freeing up time."

Taxes

"A tax loophole is something that benefits the other guy. If it benefits you, it is tax reform.'' — Russell B. Long, U.S. Senator

Monday, February 21, 2011

I have a very simple pricing strategy for doing business. It's simple to remember and easy to implement. Here is My Wealth Builder's strategy for pricing:

Free is not a price point. A colleague once commented that customers don't appreciate services that they get for free. He commented that customers of free services will not value the service, leading to frequently cancelled appoints. Charging a fee, even though a small one, created commitment by the customer.

Therefore, I won't give away my service for free, even to get trial.

No discounts to make a sale. I do not discount my services. If customers inquire about a lower price, I have two options. First, they can buy in bulk. My yearly price paid up front is 17% lower than 12 times the monthly price. To me, the time savings of billing one time versus twelve times is worth the price difference. The second option a different and lower level of service, which is commensurate with the lower price.

For renewing customers, I will maintain their initial price for at least two years, as recognition for being long term customers.

50% conversion is a good price point. I price my service such that 50% of those that inquire think the service is a great value and 50% think the price is too high. I don't want the customers that think my price is too high. In my experience, customers who didn't buy would have been high maintenance, e.g. paying bills late, requiring multiple billing, or constantly negotiating price.

The customers that pay my price realize the benefit that my services provide.

To note, I have no formal marketing or sales experience, which probably makes those in the field cringe:-) However, since my business and revenue is pretty small, this simple pricing strategy works for me.

For more on Strategies and Plans, check back every Monday for a new segment.

This is not financial or business advice. Please consult a professional advisor.

Sunday, February 20, 2011

In March 2011, I will hire on as the President of a recently formed non-profit organization. So my three and half year early retirement will come to an end. I am excited about joining during this stage of the organization's history. The role is temporary and is expected to last no longer than the end of the year. By 2012, the organization will have completed an executive search and hired a someone to fill the role of President in a permanent capacity.

At this point, I've told the search committee I do not plan to apply for the permanent position. While I reserve the right to change my mind, I am looking forward to returning to retirement by the end of 2011. In the meantime, I expect that my experiences and skills will enable to me significantly help the organization this year.

For more on New Beginnings, check back every Sunday for a new segment.

This is not financial, retirement or career advice. Please consult a professional advisor.

Saturday, February 19, 2011

"The oldest and strongest emotion of mankind is fear, and the oldest and strongest kind of fear is fear of the unknown" — H.P. Lovecraft

When I was considering early retirement, I dealt a lot with fear of the unknown. Since taking my first job, I had never lived without compensation that paid my living expense. With no personal experience, I was unsure that we had enough assets to sustain a successful retirement. However, after a few months, I was able to overcome the fear and retired in my forties in October 2007. Here's what I did to overcome my fear:

Get the facts. For most of my life, I had lived without a budget. I simply put 10-20% of my salary in savings and spent the rest. Therefore, I didn't know how much money we needed in retirement. As a first estimate, I used 80% of our take home pay for our retirement budget. Then, I asked our financial advisor to determine whether our retirement savings could deliver that income.

Look as worse case scenarios. The first analysis showed that we would be able to comfortably retire with income at 80% of our take home pay. However, I requested analyses of several worse case scenarios: lower stock market returns, no social security, and poor stock option returns. In just about every case, we were still able to maintain our retirement, although sometimes at lower, but acceptable, lifestyles.

As it turned out, looking at worse case scenarios was very useful since the Great Recession would begin in December 2007.

Develop a plan. Several plan options (e.g. pay off mortgage, put short term funds in money market funds, and cut back expenses) were developed to address the scenarios. As it turned out, we used many of the options.

After taking the above steps, we felt the future was no longer completely unknown. There was still uncertainty, however, we no longer feared going through with early retirement.

For more on Reflections and Musings, check back every Saturday for a new segment.

This is not financial or retirement advice. Please consult a professional advisor.

Friday, February 18, 2011

This past week, the temperatures were in the low 50s making round of golf a possible activity. So I decided to do my only volunteer job: playing with golfers that have disabilities. Since I had not picked up a club since November, I expected a poor to extremely poor round.

Much to my surprise, I had an exceptional round for me. I parred the first hole, ended with two pars and four bogeys, and scored a 45 for nine holes. I missed having a third par by an inch. The other three holes weren't pretty: two triple bogeys and one quadruple bogey. Overall, I was very happy with my first round the year.

As my partner commented, my game could only get worse. I acknowledged I was already on that path after the first hole, which I parred. I wasn't likely to do any better and proved it by bogeying the second hole. Oh well, it could be a long golf season this year.

Still, it's the best volunteer job I've ever had. So I will tough it out and play the entire season, even if means always having worse scores than the first round of the year :-)

For more on Reaping the Rewards, check back every Friday for a new segment.Photo This is not financial or sport advice. Please consult a professional advisor.

Wednesday, February 16, 2011

It's been over four years since I started My Wealth Builder. As I think about topics to write , I often remember, "I've written about that before," and decide to find a new topic. However, since many principles of personal finance are timeless, I want to include them in a recent post on My Wealth Builder. Therefore, I have started a series called "Timeless Articles from the Archives" and am highlighting posts from the same week in 2007-2010.

Simple Pleasures In Retirement - While working, it was easy for me to forget to relax and have fun. It was easier work hard and spend money to have fun, i.e. the work hard, play hard approach. In retirement, I have tried to break away from this syndrome and invest in more relaxation time for myself.

2009

The Mind Stays Young - To me, the hardest thing about getting older is that the mind ages much slower than the body.

My Lower Tolerance for Corporate Bureaucracy - My main bureaucracy complaint is that the corporate headquarters develops programs that sound good to management (theory), but are one notch below stupid when executed (practice) with the client, which is the interface I work.

Tuesday, February 15, 2011

Welcome to twenty-eighth edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic.

For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized them into seven categories: Earning, Investing, Insuring and Protecting, Living Frugally, Retiring, Saving and Taxes.

And now onto the Carnival:

Earning

Job-Interview-Site.com presents How to Negotiate a Pay Raise posted at Job Interview Guide, saying, "Negotiating a pay raise is not an easy task. You have to consider factors to talk about during the salary negotiation. A raise in salary will be based on your productiveness for the company and your performance value.Read further.."

Dividends4Life presents 16 Dividend Stocks Growing Future Yield posted at Dividends Value, saying, "Yield does not come without a price, usually in the form of added risk and/or complexity. Ultimately, dividend growth investors realize that long-term and sustainable high-yield investments are grown over time. This is accomplished by purchasing high-quality dividend investments with a reasonable yield and a long history of growing their dividends, and waiting for the yield on cost to grow."

Hussein Sumar presents Stocks that Pay High Dividends - February 2011 Edition posted at High dividend stocks, saying, "Recently upon the end of January 2011 & recent Egyptian crisis, the Dow Jones Industrial Average (DJIA) has reached its 12,000 points mark, the highest level seen since June 2008. Financial experts believe this is a sign where companies' profits are getting better, revenues are growing & the American economy is recovering."

PT presents How Forex Trading Works posted at Prime Time Money, saying, "A quick introduction to Forex Trading--how to trade in currency, how to set up an account, and where to go for practice before investing your own money."

Retiring

Jim Yih presents Getting Ready for Retirement posted at Retire Happy Blog, saying, "Imagine you are talking with your spouse about the topic of retirement and it is going to happen within the year. What do you need to do, to get ready for it?"

Monday, February 14, 2011

In my experience, high maintenance people can suck the capacity right out of an organization. I learned that in several of the management roles that I have had. Here are my issues with high maintenance people:

Take up significant management time. In my experience, high maintenance employees take up 80% of my management effort, leaving less time to spend with my top performers. Although one might expect benefits from such an investment, I found high maintenance people usually changed or improved the least.

Have an inflated view of themselves. Most high maintenance people that I have known believe they are top performers, despite feedback to the contrary. Sometimes they see themselves as God's gift to the organization.

Low performance in areas of responsibility. From what I've seen, high maintenance people display lots of activities but low amounts of real work. They send out lots of e-mail, work on lots of committees, and volunteer for projects not related to their responsibilities.

My solution is to put high maintenance people in roles of high individual responsibility, where outcomes are clear and contributions are due primarily to their own work. As a result, I spend less time with the person, since the role is clear, and the results from the person's work is obvious, making it harder to inflate.

In some cases, the high maintenance person will turnaround their performance, which is great. In other cases, the high maintenance person will move on their own accord to a new organization or company. In either case, the problem with the high maintenance person is solved for me.

For more on Strategies and Plans Ideas, check back every Monday for a new segment.

Sunday, February 13, 2011

In the past, my spouse and I have not purchased trip insurance. We took our chances on not being sick nor experiencing trip interruption. We have been lucky so far and have not missed a planned trip. However, for our next vacation, we have decided to purchase trip cancellation insurance for about 10% of the vacation's cost. Here are our reasons:

Young child. As a former boss used to say, " Children can get sick at a drop of a hat," especially if they are in school or day care. My spouse and I are still pretty healthy. Typically, we'll make a trip even if we're not feeling well. However, we don't want to put that burden on a child.

Older parents. The health situation of aging parents can change suddenly. For example, my mother is in a nursing home. While her condition is stable, a sudden change may require my attention or presence.

While a health related issue has not arisen yet prior to a vacation, I feel the probability has increased significantly for us. Going forward we want to flexibility to adjust to our child's or parents' health situation. Therefore, for vacations requiring up front payments, we will be buying trip cancellation insurance.

For more on New Beginnings, check back every Sunday for a new segment.

This is not financial or insurance advice. Please consult a professional advisor.

Friday, February 11, 2011

While working at one of my part time jobs, a colleague mentioned to me that Social Security can be paid to minor children of Social Security recipients. This was new information to me and I decided to check with the Social Security administration, since our daughter is only six years old.

Here's what I learned. When I start collecting Social Security payments the following people can also qualify for additional payments from Social Security:

My spouse who earns less than $14,000 and is caring for a child under 16. She can collect 50% of my full retirement benefit.

My daughter until she turns 18 (19 and 2 months while in high school). She can collect 75% of my full retirement benefit.

Total family benefits are limited by the calculated maximum benefit amount.

Due to the auxiliary benefits, it is financially beneficial for me to start my Social Security payments when I'm 62, instead of waiting for full retirement age. Even though my payments will be reduced, the additional auxilliary payments will make the break even point for waiting be several years older.

For more on Reaping the Rewards, check back every Friday for a new segment.

This is not financial or retirement advice. Please consult a professional advisor.

Thursday, February 10, 2011

Our 6 year old daughter dislikes kindergarten math. While she uses reading every day, our daughter doesn't see any benefits for learning math since she does not use math daily. My solution is to link math with an everyday task, such as using money.

A couple times a week, I plan to do addition and subtraction exercises with my daughter with coins. My deal with my daughter is that for every five correct answers in a row, she will get to keep her choice of one set of coins. This has significantly increased her interest in learning math. Fortunately, the total value of coins will be usually under a quarter. However, if I end up losing a lot of money, I will be happy she is learning her math:-)

For more on Crossing Generations, check back every Thursday for a new segment.

This is not financial, parenting or education advice. Please consult a professional advisor.

Wednesday, February 09, 2011

It's been over four years since I started My Wealth Builder. As I think about topics to write , I often remember, "I've written about that before," and decide to find a new topic. However, since many principles of personal finance are timeless, I want to include them in a recent post on My Wealth Builder. Therefore, I have started a series called "Timeless Articles from the Archives" and am highlighting posts from the same week in 2007-2010.

2007

Retirement Planning - A Staged Approach - Before the housing crash, here's how I was integrate home ownership into our retirement planning. Even after the housing crash, it will till work for us.

Lessons From The Poker Table - On weekends in college, I regularly played poker. The lessons I learned in poker were very applicable to my career and life.

Tuesday, February 08, 2011

Welcome to twenty-seventh edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic.

For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized them into seven categories: Earning, Investing, Insuring and Protecting, Living Frugally, Retiring, Saving and Taxes.

Dividends4Life presents 28 Dividend Stocks Acting Like a Money Machine posted at Dividends Value, saying, "Readers of this space know that the primary focus of my investing efforts is to build an ever-increasing income income stream by investing in dividend growth securities. This means that often I will choose a lower yielding security with better dividend growth prospects over a higher yielding security. As one that values diversity, I also invest in some high yield securities."

Monday, February 07, 2011

“The hardest thing in the world to understand is the income tax.” — Albert Einstein

For most people, communicating with the IRS is a fearful event. After all, many IRS notices are requests for more money because of an apparent mistake by the taxpayer. It seems like a lose only situation. However, the IRS notice is only a beginning which notes a difference in calculation of income or requests for proof of deductions or credits. The next step is to minimize the increase in income or verify the the deduction or credit.

Here's how I do it:

Read the specifics of the IRS note. Is it a claim of under reporting of income? Denial of deduction or credit? Or a request for documentation? Depending on the note, different actions may be needed.

Know the tax regulations involved. Understand the definitions, requirements and details of the tax laws. The IRS isn't interest in arguments based on emotions, fairness or logic. Specifically, the IRS will be look at the facts that demonstrate compliance with the regulations.

Assemble the documentation. If the IRS is correct, I agree and pay the requested amount. If I don't agree, I use the facts to develop support for my case. Doing an amended return for the tax year in question is often a good way to prove my case.

Submit the information before the deadline. I always submit my supporting documentation before the deadline. The IRS usually allows 30, 60 or 90 days to respond If I need an extension, I call and request one.

From my experience, I estimate the IRS is completely right about 25% of the time. About 50% of the time, the IRS is only partially right and less is owed than the amount requested. About 25% the IRS has made a mistake and nothing is owed. In rare cases, there is even a refund.

For more on Strategies and Plans, check back every Monday for a new segment.Photo

This is not financial or tax advice. Please consult a professional advisor.

Sunday, February 06, 2011

I am going to accept a position as temporary executive director of a new non-profit organization. The contract is expected to last no longer than end of 2011, at which point I will transition to a permanent executive director for which a national search is being done. Effectively, I will be un-retiring since this a paid position which will require close to 40 hour work weeks.

I am excited about the position mainly because of my passions for helping people and personal achievement. I believe the combination of my passions, career and volunteer experiences will enable me to grow the organization to help more people, i.e. make a difference.

In addition, the position will enable me to expand my professional network since I will be working with others that have similar passions, executives at potential sponsoring companies, similar organizations across the country. I may even call on a few classmates who are in a position to contribute.

Finally, the role will help me set a good example for my daughter, who will benefit from seeing a parent working regularly at a job full time. I wouldn't want her to grow up thinking that non-working parents the norm :-)

Being over 50, I know that I won't get many more opportunities like this. So I will take the first step and accept the temporary position. If the job turns out to be the expected great match, I may even apply for a permanent role.

For more on New Beginnings, check back every Sunday for a new segment.

This is not financial, career or retirement advice. Please consult a professional advisor.

Saturday, February 05, 2011

Several of my part time jobs involve working with clients on a one-on-one basis. While many clients don't uses a single provider, each year I have had more clients specifically request my services even though others are available sooner. This year, I have had the largest increase in clients requesting appointments only with me. Here's what I think I've done to build client loyalty:

Customize the product - While our company offers a standard product, I take additional time to understand each client situation and modify the offering to meet their needs. In addition, I anticipate what may be future needs and provide guidance on options.

Demonstrate value - During my meeting with clients, I show them my understanding of the product and demonstrate how that can benefit them. I explain the reasons for different options and clearly explain the benefits for the choices made.

Exceed expectations - Most of my clients leave with more than they expected from our service. For example, I may show them benefits that have been missed, handle a difficult issue, or explain how small changes can create benefits next year.

Overall, I believe the loyal clients are ones that trust me give top priority to what is best for them. Because the trust exists, the client asks specifically to see me when making an appointment. For next year, I hope create a base of at least 50 loyal clients that specifically request me for an appointment each year.

For more on Reflections and Musings, check back every Saturday for a new segment.

Friday, February 04, 2011

Historically, Social Security has allowed beneficiaries to payback previously received benefits interest free and restart payments at a higher benefit level. Originally, the payback option was allowed so as not to penalized beneficiaries who could qualify for a higher benefit. However, as the payback option became more known, many financial advisors realized that the option was effectively an interest free loan and a great hedge to protect higher benefits. Thus, a Social Security recipient could start taking benefits at 62, put the money in the bank, earn interest, return all the payments at 70 and begin receiving the higher monthly benefit. Not only would the beneficiary be guaranteed higher payments the rest of his life, he would also get to keep all the interest earned for 8 hears. Of course, this assumes the beneficiary did not need to spend the money on living expenses.

Effective December 8, 2010, Social Security has eliminated the current payback option. Beneficiaries can no longer payback benefits and restart at higher payments indefinitely. Paybacks must now be initiated with 12 months of starting benefits and can only be done once in a lifetime. In addition, suspending benefits voluntarily can only be done for payments that have not been received, i.e. one cannot suspend benefits earlier and repay payments. The elimination may save Social Security as much as $5.5 billion if every beneficiary with sufficient liquid assets used the payback option.

While I had evaluated the benefits of using the payback option, I am not unhappy Social Security has eliminated the do over. Losing the option will eliminate a retirement benefits scenario and reduce our decision to simply when I start taking benefits and when my wife starts. As I get older, simpler is definitely better :-)

For more on Reaping the Rewards, check back every Friday for a new segment.

This is not financial or retirement advice. Please consult a professional advisor.

Thursday, February 03, 2011

In 2010, Tony's Pizza offered free bowling coupons on the package. So for less that $2.50, I could get a frozen pizza and one game of bowling. Shoe rental was extra, but my spouse and I own bowling shoes making one game completely free for us, but not our daughter.

In 2011, Tony's Pizza is offering coupons for free admission to participating roller skating rinks. Skate rental is extra and no one in our family owns skates. However, a local roller skating rink has a special that includes admission and skate rental and is accepting the Tony's coupons for the session. Thus, for $6-9 (depending on weekly Tony's promotions), we can get three pizzas and three free roller skating session. Since the total cost of roller skating for our family is normally $15, I consider the Tony's Pizza coupons a great deal for family entertainment.

The idea of free family entertainment is a great idea. Usually, it's hard to find free promotions that appeal to everyone in our family. In case Tony's Pizza needs an idea, I'm hoping the next free coupon promotion will be for admission to an ice skating rink :-)

Disclosure: No compensation was received for writing and posting this article.

For more on Crossing Generations, check back every Thursday for a new segment.

This is not financial or family activity advice. Please consult a professional advisor.

Wednesday, February 02, 2011

It's been over four years since I started My Wealth Builder. As I think about topics to write , I often remember, "I've written about that before," and decide to find a new topic. However, since many principles of personal finance are timeless, I want to include them in a recent post on My Wealth Builder. Therefore, I have started a series called "Timeless Articles from the Archives" and am highlighting posts from the same week in 2007-2010.

Tuesday, February 01, 2011

Welcome to twenty-sixth edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic.

For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized them into seven categories: Earning, Investing, Insuring and Protecting, Living Frugally, Retiring, Saving and Taxes.

And now onto the Carnival:

Earning

"Writing is the hardest way of earning a living, with the possible exception of wrestling alligators." ~ Olin Miller

Insuring and Protecting

"The chief beneficiary of life insurance policies for young, single people is the life insurance agent." ~ Wes Smith

CreditCardGuru presents American Express Extended Warranty Review posted at credit card forum [the blog], saying, "If you have an American Express card, here are some important things you need to know about the extended warranty benefit. It's a great free perk for protecting your purchases, but if you don't understand the rules and exclusions, you could be in for a nasty surprise."

Investing

"We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful" ~ Warren Buffett

Hussein Sumar presents 5 Tricks to Successful Dividend Investing posted at High dividend stocks, saying, "Why should you make dividend investing a part of your strategy? Because it is free money! Think of dividend paying stocks as investments that will put cash in your wallet, without you having to worry about market values going higher. According to value investor Benjamin Graham, this becomes especially true for those companies with tons of cash flows & little or no debt. The school of thought behind this is, why should you care of growing your stock's price from $50 to $52 if you are already getting a decent 8% annual dividend yield from your company; this in a world where banks are literally offering 0.75% interest on a 12 month GIC. In this article, we explain the 5 basic traits that all successful dividend investors should have."

Dividends4Life presents 25 Stocks Building Wealth Through Higher Dividends posted at Dividends Value, saying, "To ensure a retirement that is free from financial concerns, there are certain things that must be done today. The stock market does not travel in a straight line. There will be times it will behave irrationally. These are the times that try an investor’s patience. Those with clear goals and confidence in their chosen strategy aren’t phased by these market movements."

FIRE Getters presents Investing - The Mistake Of Timing The Market posted at FIRE Finance, saying, "We sometimes ponder and try to speculate the market. Basically we try to time the market to maximize our gains. Often we give up in despair! There are so many factors to be taken into account, volumes of information to be considered (not all of them are all reliable either) and finally there is a humongous number of unknown parameters that may influence the market! How on earth does one tackle all that?"

Jim Yih presents What is Estate Planning? posted at Retire Happy Blog, saying, "An estate plan is absolutely essential for organizing your financial affairs and providing for the well being of your family."

Saving

"Lack of money is the root of all evil." - George Bernard Shaw

PT presents Ideas for Your Social Security Tax Break posted at Prime Time Money, saying, "We will all be seeing extra money in our paychecks this year because of the payroll tax withholding deduction. So what should you do with that additional cash? PT Money has some great ideas."

Taxes

"The nation should have a tax system that looks like someone designed it on purpose." ~ William Simon

Craig/FFB presents 2011 Federal Income Tax Brackets posted at Free From Broke, saying, "Take a look at each of the Federal Income Tax brackets for both single taxpayers and married couples filing jointly, and take a look at what is changing going into 2011."

About Me

My wealth goal is to create a guaranteed yearly income stream equal to my highest salary for my retirement years. While I have developed a strategy to do this,
I am interested how others are thinking of achieving financial security for retirement.
This blog is a summary of facts, ideas, discussions, and action plans to achieve that goal.

Disclaimer

This is a personal blog about my thoughts, experiences and ideas on building wealth. The contents of this blog are for informational purposes only. No content should be construed as financial advice. Commenters, advertisers and linked sites are entirely responsible for their own content and do not represent the views of My Wealth Builder. All financial decisions involve risks and results are not guaranteed. Always do your own research, due diligence and consult your own professional advisor before making any decision. My Wealth Builder assumes no liability with regard to financial results based on use of information from this blog.

If this blog contains any errors, misrepresentations, or omissions, please contact me or leave a comment to have the content corrected.

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Disclaimer:
This is a personal blog about my thoughts, experiences and ideas on building wealth. The contents of this blog are for informational purposes only. No content should be construed as financial advice. Commenters, advertisers and linked sites are entirely responsible for their own content and do not represent the views of My Wealth Builder. All financial decisions involve risks and results are not guaranteed. Always do your own research, due diligence and consult your own professional advisor before making any decision. My Wealth Builder assumes no liability with regard to financial results
based on use of information from this blog.

If this blog contains any errors, misrepresentations, or omissions, please contact me or leave a comment to have the content corrected.